Holden boss causes more questions than answers

THERE were more questions than answers after Holden boss Mike Devereux hosed down suggestions the Australian plant was about to close.

Mr Devereux was grilled at the Productivity Commission inquiry on Tuesday, refuting claims that parent company General Motors had decided to shut down its South Australian factory.

Ford has already committed to closing its Victorian manufacturing operations by 2016, and government leaks suggested Holden was about to do the same.

But Mr Devereux was steadfast in his support of the local industry, pleading his case for extra funding and improved trade conditions and possibly a public-private partnership.

According to the Productivity Commission, taxpayer subsidies are covering about $2500 of the cost of each Australian-made car.

Car manufacturing subsidies have averaged about $550 million annually for the past six years. The subsidy is equivalent to 10% of the average cost of a car while the tariff on imported vehicles is 5%.

Yet the underlying issue is jobs. Industry experts say up to 50,000 positions could be in jeopardy if Toyota and Holden follow Ford's departure - jobs both at the factories and supporting industries.

At yesterday's inquiry Mr Devereux did reveal even if Australian manufacturing does continue at Elizabeth, the proposed "next generation" of Holdens to be produced from 2016-2022 are forecast to have only 25-30% local input. That could also threaten the Australian parts industry.

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It seems Aussies are voting with their tyre prints. So far this year, locally produced cars from Holden, Ford and Toyota have accounted for 106,722 sales according to VFACTS statistics. Imported cars have notched up 932,749 sales in a growing market.

Australian made cars are down 16.5% year to date.

Have we lost our lust for home-grown cars?

Recent Roy Morgan research says we have. Their survey found less than half of Australia's 15.6 million drivers prefer to buy a car made in Australia.

So there's an elephant in Australia's room: do we really want an industry?